Continued Construction Industry Growth Predicted for 2015

In his 2015 economic forecast released Dec. 9, ABC Chief Economist Anirban Basu relayed his forecast for a steady recovery among the U.S. commercial and industrial construction industries in 2015, continuing the momentum built in 2014.

“ABC forecasts nonresidential construction spending will expand by roughly 7.5% next year,” said Basu. “The segments that will experience the largest growth in construction spending in 2015 include power, lodging, office space and manufacturing.

“The public sector will see far more sluggish growth in construction spending,” Basu warned. “However, this fits a multi-year pattern with private nonresidential spending exceeding public nonresidential spending by 28% in 2014, up from 15.6% in 2013.

Additionally, the Bureau of Labor Statistics reported on Dec. 5 that the U.S. construction industry added 20,000 jobs in November, including 4,900 in nonresidential construction. This increase in employment numbers added to Basu’s prediction that industry growth would continue into 2015, but also addresses the affect the lack of skilled workers has on the potential nonresidential job growth.

“It is important to note that the greatest constraint on nonresidential job growth may no longer be a lack of demand for construction services, but rather a lack of supply of sufficiently skilled workers,” Basu said

“Taking into account current economic momentum, especially in the form of employment growth, ongoing accommodative monetary policy and increased growth in consumer spending, further stoked by falling gasoline prices, 2015 should be a decent one for the U.S. economy,” concluded Basu. “Contractors should continue to experience a lengthening backlog and the industry should continue to see increases in nonresidential construction spending and employment growth.”